"However, I think in the light of what has happened, it is obviously sensible to go back and consult them again."

He added that as a "matter of principle" he would prefer to have the use of intercept evidence in court proceedings available.

Intelligence officers and senior policemen have tended to be opposed to the use of phone tap evidence in court, fearing that secret methods could be exposed.

Former M15 officer Michael Flint told BBC News the security services are not equipped to cope with the new kind of threat.

"You need people with ethnic backgrounds to conduct the surveillance operations. The people that they had before, white young males and females, would simply stand out."

He said in the four or five years of the current raised threat there had not been time to build up close links with intelligence services in the Middle East and South Asia.

Professor Anthony Glees, director of Brunel University's Centre for Intelligence and Security Services, said intelligence officers needed to return to "elementary tasks" like monitoring subversion, and other "Cold War tactics".

Mr Blair has also said he wants an international conference about issues arising from Islamic extremism.

He told MPs: "Though the terrorists will use all sorts of issues to justify what they do, the roots of it do go deep, they are often not found in this country alone therefore international action is also necessary."

'Indirect incitement'

On Wednesday Home Secretary Charles Clarke revealed he has asked the Home Office, Foreign Office and the intelligence agencies to establish a full database of extremists.

Anyone wanting to enter the UK would be checked against the list - and if they are on it they may be refused permission to enter the country.

In a statement on the aftermath of the London bombing, Mr Clarke also said he planned a new offence of "indirect incitement to terrorism", to add to the current offence of direct incitement.

He said it "targets those who, while not directly inciting, glorify and condone terrorist acts knowing full well that the effect on their listeners will be to encourage them to turn to terrorism".

Mr Clarke told MPs he wanted to apply more widely the home secretary's powers to exclude an individual from the UK if their presence is deemed "not conducive to the public interest".

"I intend to draw up a list of unacceptable behaviours which would fall into this - for example preaching, running websites or writing articles which are intended to foment or provoke terrorism."

The government has also announced that task force to tackle Islamic extremism "head on" is being set up in the wake of the bombings.

On Thursday, victims of the London attacks will be remembered at the British Medical Association in Tavistock Square - where a bus was blown up, killing 14 people.

A service will take place in the courtyard of the BMA's headquarters where many of the injured people were treated.